Worldcom, SEC settlement approved

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The deal calls for an unspecified fine against the company, and continued oversight of its activities by the government regulator.


A federal court has approved a partial settlement in the case between Securities and Exchange Commission (SEC) and the disgraced telecommunications company, WorldCom.

The settlement stems from civil charges that relate to WorldCom's US$9 billion accounting fraud, in which the company had overstated revenues.

The deal calls for the continued oversight of the court-appointed monitor of the company, and could lead to an expansion of the monitor's role.

US District Judge Jed Rakoff said the ize of the WorldCom fine would be determined later.

The company has also agreed to hire independent consultants from outside to review its internal accounting controls. It must also provide mandatory training in accounting and ethics to its accounting employees for at least three years.

Four WorldCom executives have already pleaded guilty for their roles in the fraud that resulted in WorldCom's bankruptcy. Judge Raoff has approved settlements for two of those executives.

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